Update

Tuesday -
Morning (Electricity Inspection)

Wedensday
Morning (Send Maid to Post office to send money)
Evening (went to see lights at Balestier)
Night (Write Business Proposal)

Thursday
(Check for Annual report)

Sat (Send Mum/Bro & Myself for Medical checkup)

Next confirm lawyer letter
Source for buyers

Bathroom + Kitchen accesssories



Tuesday (Choose Lights/ Curtains/ Wallpaper / review design again (balcony/ Master Bdroom (TV console/ Children's bed)

May- Aug Weekend burnt

Every weekend is burnt, from May, all weekends burnt at my Dad's office (inventory check/sorting accounts) , that I dun even have time to cut my hair.

The previous previous weekend was mainly
-checking for defects at my property
- meeting up with designer (confirm design & material)
- busy chasing the property agent for property agreement

The previous weekend Sat was
- morning (Hsien Zheng's class)
- afternoon meeting up with the designer to confirm materials, designs etc.
- Sunday morning was breakfast
- visiting my Dad
- going to Parkmall to shop for sofa, finally got a satisfied German sofa from Castilla.

The last weekend Sat was
- morning (Hsien Zheng's class)
- afternoon went to Ubi to look at sofa and dinning set
- Later in the evening, went over my Dad's property for defects inspection
- and after dinner went to Furniture mall to get my dining set. (really super productive).
- Sunday morning breakfast
- visiting dad
- afternoon went to my dad's office to sort out accounts again and record payment.

Rental of Property

Rental of property
My Dad actually wanted to rent out his new property, so I had to see what is the best way to rent out. I actually thought of renting out myself, but after seeking advice from my Uncle, it is best to leave it to an agent. Why ?
- my dad's property is a 4 bdroom, and usually those are expats from MNCs and these MNCs will employ property agents to do it
- at the end, after co-broking it is still the agents who will get the commission
- the agent will sort the SP Power (electric/water and Gas) transfer to the
Anyway I also posted in SingaporeExpats and was going to post in PropertyGuru and SPH (ST171??) and newspaper.
My Uncle advise is to try to get as much conditions favourable to myself (owner) as possible. For. eg. if there is any defects to be repaired, the bar should be at an individual case.

May- July Had to take over my Dad's business

May Investment

Divested most of my shares (was caught by part of the fall) and shifted to gold & silver. After making some profits, my mind was affected by something that happend to my family. Anyway after clearing my Gold & Silver profits, I shorted Oil at 70 (Should have shorted S&P 1080), the lesson learnt (again) is to short the relevant one.

Portfolio July - YTD up 10% (excluding property taken as constant) - 20% Property, 40% shares, 40% cash

I had to take care of my family business.

1) First thing was to ensure I had the signatory authority so that my dad business can continue (pay supplier etc)

2) Check for outstanding payment - Eg. Singtel, CPF (pay by post), income tax etc

3) Next get the aging list and chase for outstanding payment from customers. Had to make sure cash comes in. My dad is an excellent Salesperson, but business-wise, he needs to convert this into cash, otherwise there are alot of bad debts. Some customers especially overseas are very hard to chase for payment. It is really tough to get money from customers. The accounts were terrible also, some payment were not recorded correctly and I had to investigate several times and correct them. There were also several bad paymasters and had to get them to commit dates to repay. After which many follow ups and even threatening for legal actions. We had to differentiate between

• i) Bad paymasters and no business dealings already (Tough action)
• ii) Bad paymasters and still have business dealings (Have to be polite but firm). Also have to withhold sending of goods unless they pay.
• iii) Those overseas r the most headache

4) Other operations, - Tried to resolve the dot-matrix printer problem but unsuccessful - Removed a wuauclt.exe virus (takes up hugh memory as I thought that could be the problem) - Downloaded - ATF Cleaner, DrWeb, SuperAntiSpyware, booted up in Safe mode and removed wuauclt.exe not in Windows32 directory. - Get Epson dot-matrix printer (280 + USB printer) from SLS and assembed it to work The above spent 3 days ( had to take 2 half days)

5) Got company on-line statement (Compay registry had to prepare a resolution) so that we can track TT payments/ cheques bounce, otherwise we have to wait till end of the month to countercheck payment

6) Spend my weekends doing inventory checks.

7) Now to get Singtel Giro and continue to chase for payment.

Property Investment in April

Shares

Divested my remaining SMRT at 2.16 and Best World. The visibility in Best world is really not there. And I feel that the startup cost for the circle line for SMRT will take a long time (at least 1 -2 years to recoup see NE line).

Property

- Bought my 2nd property at Dakota Residences. I was tempted to buy when I knew that Waterbank ( the property to be launched next to it was selling at 1200psf. So after much thoughts, I bought a 4-rm at Dakota at 1050 psf. Comparing around, i feel that it has more potential to appreciate comparing The Shore (1300 psf) which is not near any MRT/Shopping Centre, SilverSea (totally overhyped high end selling) at 1600 (no sea view)- 1900 psf. Also interest rate should be low for 1-2 years. + Dakota is next to the upcoming Sports Hub (Lifestyle and 2nd Singapore expensove Architectural Icon)

- Sibor/SOR Had to look for banks (Sibor/Sor) finally settled for OCBC (SOR).

SIBOR stands for Singapore Interbank Offered Rate and is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the Singapore wholesale money market (or interbank market).SIBOR stands for Singapore Interbank Offered Rate and is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the Singapore wholesale money market (or interbank market).

The Swap Offer Rate (SOR) represents the effective cost of borrowing SGD synthetically through borrowing USD for 3 months and swap out the USD in return for SGD for the same maturity

The simple reason why I settled for SOR is I believe the interest rate in US will be ultra low for a long time. The low interest rate will not help the US unemployment rate and with unemployment rate still high, interest rate will remain low in US. Also SOR (abt 0.38 as of today) is cheaper than SIBOR (0.438)

I got a very good deal at OCBC (1st year 0.5 +SOR, 2nd year 0.75+SOR and 3rd year 1.25+SOR). Also I got a mortage broker to get a mortage referral to get some dough back. Ha ! It looks like my property agent course got its refund.

- Sold my HDB flat ! I also advertised in the newspaper and sold my HDB property 50+ K over valuation (in 1 day!). Had to spend time advertising SPH and find free online

• cleaning up the house, paint (red wall & TV consle),
• fix several items (lights/kitchen cabinet door).
• And after that HDB inspection, had to fix up the aircon pipe to touch the basin(went to Lavender SimBH to buy pipes/ connectors and saws)

Jan - Mar Investment & Personal Update

Jan - Finally Fixmarket got strike off

2009 is up a paltry 9% compared to the 40-50% gains by most markets.
The main culprit was my biggest holding 40% Celestial which went down 50% (-20% in my portfolio) which unfortunately had to sell at a substantial loss. Celestial did not have $$ to pay off its bond and defaulted. Cashflow & profit grind to a halt and its survival is in the balance.

Divested most of my SMRT (1.87 and 2.16) and CDL (1.78) and move into tech (already make some movement upwards) (Hiap Seng & Broadway, Best World)

For work wise, my business orgnanisation got a new head and everything got restructed, which means I had to work several weekends (burn CNY) for new reports / meetings etc, same as last year. sigh This continued till March

Personally, my 2nd kid Hsien Yi really a handful, making us having little sleep ( wakes every 3 hours) at night.

D.O.G on Oilpods

WARNING: VERY LONG POST

For those thinking about Oilpods, here is some information that may prove useful.
1. Oilpods is a project of OL&M, Business International Pte Ltd, a company registered in Singapore. OL&M's website is: http://www.oilpods.com.

2. OL&M sells shares in oil and gas production leases, known as "working interests" in industry jargon.

3. Investors in working interests buy a percentage of all current and future oil and gas revenues for a particular project. An upfront payment is made, in exchange for a revenue stream tied to the sale of oil and gas from that particular project.

4. Revenue stops when that project's oil and gas is exhausted or uneconomic to extract. If the upfront payment is less than the NPV of the future oil and gas revenues, a profit is made. A loss is made if the converse is true.

5. The working interests are sold to OL&M by Powder River Basin Gas Corp, a company quoted under the code "PRVB" on the OTC BB in the US. OL&M in turn sells these working interests to investors. The websites for PRVB and the OTC BB are: http://www.powderrivergascorp.com http://www.otcbb.com

6. PRVB's business has 2 arms: a. Purchase of marginal / non-producing oilfields with the aim of increasing or restarting production; and b. Sale of 25% working interests in the above oilfields to generate working capital.

7. PRVB currently owns working interests on about 8,000 acres of land, in either 100% or 75% proportions.

8. According to the Form 10-K (available at the OTC BB website) filed with the SEC, for the year ended 31 Dec 2005, PRVB booked revenue of US$4,643,965 and net income of US$699,335.

9. The revenue breakdown was US$622,882 in oil and gas revenues, and US$4,021,083 from the sale of working interests.

10. The commission paid to outside investors of the working interests was US$482,500.

Some lay analysis:
PRVB sells working interests to OL&M, which then sells them to investors. Investors' funds flow to OL&M, which passes a portion of the funds to PRVB, which in turn books these as revenue.

As PRVB develops the oilfields and sells oil and gas, a portion of the revenues are paid out to OL&M, which in turn pays the investors. Therefore, the investors' income streams are dependent on the oil and gas production at the PRVB fields where they own a working interest.

However, we can see that PRVB sold only US$622,882 of oil and gas. Since it only sells 25% working interests and retains a 75% stake, the commissions paid to investors in the working interests should be at most 25% of oil and gas revenues i.e. US$155,720.50. However, the actual commissions paid were US$482,500. The extra US$326,779.50 paid out appears to simply be a return of capital.

In other words, it seems that PRVB may actually be operating an elaborate Ponzi scheme. For as long as it can sell working interests, it can generate cashflow, from which previous investors can be paid, regardless of whether it is actually selling any oil or gas.

Evidence:
FY05 administrative expenses were US$1,181,374, and lease operating costs were US$258,662. These expenditures supported the production and sale of oil and gas, yet the company only sold US$622,882 of oil and gas. The story is the same for FY04: adminstrative expenses of US$513,854 and lease operating expenses of US$97,025 were used to generate US$248,328 in oil and gas sales.

Clearly, the current cost structure of PRVB makes it impossible to actually earn any profits from selling oil and gas. It is deriving all its "profits" from selling working interests. These working interests appear to be overpriced with respect to the value of the oil and gas they appear to be producing. It is possible that PRVB is deliberately misrepresenting the true value of the recoverable oil and gas i.e. fraud may be occuring.

Implications:

So, back to Oilpods. If someone was to invest with OL&M, he would be buying a working interest directly from OL&M and indirectly from PRVB, and his future cashflow would ultimately depend on the sale of oil and gas from the corresponding field being operated by PRVB.

As shown above, the cashflow being paid out is coming from other new investors purchasing working interests as well as from the sale of oil and gas. For as long as PRVB can find new investors, current investors will be able to receive an income stream.

If, however, PRVB is unable to continuously sell additional working interests, based on its current cost structure, its oil and gas revenues alone will not suffice to pay the investors their due commissions. PRVB will then default on its payments to OL&M.

If OL&M is not able or willing to make good the payments out of its own pocket, it too will default. The investors can then choose to either write off their investment, or sue OL&M for misrepresentation, fraud, etc. Of course, their legal choices may be limited by any waivers that they signed when purchasing the investment in the beginning.

As usual, YMMV. The analysis above is based on public information only. It may be flawed and is not conclusive. IMHO anyone interested in Oilpods should visit the 3 websites (OL&M, OTC BB, PRVB) and do some reading, so that they can make an informed choice